The expansion of a program from American Express and the fintech Nova Credit could translate to improved credit access for immigrants from Brazil, Kenya, Nigeria and the Dominican Republic. The Credit Passport taps credit records from certain international credit reporting agencies and uses the data for American Express card decisions.
San Francisco-based Nova Credit created the Credit Passport program, which American Express has integrated into its online application process.
Card applicants can authorize Nova Credit to “translate their raw international credit bureau data into a U.S.-equivalent credit report,” says Sara Milsten, senior vice president of new member acquisition for U.S. consumer services at American Express.
[Read: Best Starter Credit Cards.]
The report resembles a U.S. credit report and includes a credit score, inquiry history and list of credit accounts.
Nova Credit shares the information with American Express, which helps the lender decide whether to approve the credit application.
Traditionally, establishing credit history has been “a big point of frustration for many newcomers,” Milsten says.
A lack of credit history can prevent anyone from renting a home, buying a phone or car, or getting a credit card.
“We believe newcomers to the U.S. should be able to use the credit history they’ve built from their home country, and this capability helps them do just that,” Milsten says.
The Credit Passport program kicked off in 2019, serving immigrants from Australia, Canada, India, Mexico and the United Kingdom. This recent expansion means newcomers from nine countries can use the Credit Passport, and the plan is to further expand the program next year.
The Credit Passport serves a role similar to the one filled by credit reporting agencies such as Equifax, Experian and TransUnion, according to American Express. Since the launch of the Credit Passport, thousands of immigrants have successfully applied for credit using the program, American Express reports.
[Read: Best Secured Credit Cards.]
John Ulzheimer, a credit expert formerly of Equifax and FICO, says the Credit Passport should address a crucial and largely unmet need.
“People who are new to the U.S. may have a voluminous credit report in another country, but when they move here, it’s almost like they’re an 18-year-old trying to get their first credit card,” Ulzheimer says.
Most immigrants who have paid bills, owned a home or bought a car likely have some type of international credit history, according to AmEx.
If you want to use Credit Passport, you do not need a Social Security number or taxpayer identification number. But you may be asked to provide multiple forms of ID, such as a driver’s license and a passport.
You must also have a U.S. address to apply for an American Express card.
In some cases, approval can be instant, and in others, you could wait for up to 14 days. Rarely, approval can take up to 30 days, according to AmEx.
If your application is approved, you will receive a 15-digit instant card number to “immediately start shopping online or where digital wallets are accepted,” Milsten says.
[Read: Best Credit Cards for Bad Credit.]
Applicants who are not approved for a card can reapply, preferably at least 30 days after receiving a rejection letter, according to American Express.
“We approve the majority of applicants who are able to verify their identity and have an untarnished credit history in their prior country of residence,” Milsten says.
If you cannot get approved through Credit Passport, you could consider companies such as Petal, which make underwriting decisions based on your banking history instead of credit reports, Ulzheimer says.
“The sooner you can get in the U.S. banking system, the sooner you’ll be able to get access to credit, even if you don’t yet have a credit report or score,” he says.
But the goal for any immigrant should be to establish a traditional credit report and credit score, he adds.
“You won’t be able to finance larger-ticket items like homes or cars without them,” Ulzheimer says.
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American Express Expands Credit-Access Program for Immigrants originally appeared on usnews.com
